NEW YORK (CNN/Money) -
Duke Energy Corp. said Monday it is buying Cinergy Corp. in an all-stock deal worth about $9.1 billion.

The merger will lead to an expected 1,500 job cuts, or about 5 percent of the current combined staffs of the two utilities.

Cinergy (Research) shareholders would receive 1.56 shares of Duke (Research) stock for each of their shares, Duke said. Based on Friday's closing prices, that represents a premium of about 13 percent for Cinergy shareholders.

The combined company -- which would be called Duke Energy -- would serve about 5.4 million customers across two-thirds of the United States, as well as portions of Canada and Latin America. In 2004, the two companies combined for $27 billion in revenue and $1.9 billion in net income.

The companies say they see $400 million in annual cost savings by the third year after the deal's closing.

The companies said that the deal should add to Duke's earnings per share in the first full year after the closing.

The companies also announced that Duke plans to raise its annual dividend payment by 14 cents a share to $1.24. The new dividend would take effect with the September payment. The move would keep Cinergy shareholders' dividend payments level with the current payout.